the reserve army of the unemployed

[lemur]

Karl Marx wrote that capitalism needed to maintain a "reserve army of unemployed workers" as part of the means of business to maintain a cheap supply of labor. Since labor-oriented political-theorists surely know of this logic, why do they always call for more jobs? Is it that they expect to dissuade capitalism from pursuing the interest of cheap labor or does it maybe have the function of increasing restlessness among workers, thus promoting even greater willingness to accept lower wages and given working conditions, etc.? If media sources suddenly started reporting job-surplusses instead of calling for job-creation, would that have the effect of promoting greater feelings of worker-empowerment and choice?

[padren]

It's easier to think of it in terms of the unemployed and job openings. A job-surplus means there are more jobs open than people looking for jobs, and it isn't a precise enough metric to describe the range of reasons that can cause it. First, you can have high unemployment and high job openings to the point that the effects of a job-surplus are felt, even if there isn't one: you can have a huge number of unemployed people who cannot perform the jobs there are openings for.

 

The important factors are:

1) When job openings are created it means there is economic potential to grow that is unrealized... as growth is the main motivator for private companies to hire more staff.

 

2) For as long as that job goes unfilled, that growth is under-realized and can lead to classic "oh no job surplus" growth-stagnation when companies want to grow but can't find people to hire. Not all jobs should be filled because a lot of potential jobs may be nonviable - for instance a lot of people try to hire on commission for products/services that an applicant feels are unsellable.

 

3) More job openings invariably increases the choices available to people, allowing them to upgrade from a jobs they are less suited for, and allow more options for unemployed people to find work they can do.

 

 

The "army of unemployed" referenced by Marx is a very black and white way of describing the elastic relationship between the number of unemployed as a percent of the population that generally indicates job openings can be filled in a reasonable span of time. While it is true capitalism cannot effectively function with 100% employment I'd challenge Marx to find any mechanism to employ the bottom 5% of people (rating by hireability) in a Jerry Springer studio audience.

[CaptainPanic]

Karl Marx wrote that capitalism needed to maintain a "reserve army of unemployed workers" as part of the means of business to maintain a cheap supply of labor. Since labor-oriented political-theorists surely know of this logic, why do they always call for more jobs?

Because saying that "We will deliberately keep the unemployment at an economically interesting level" isn't gonna help you win any elections.

 

Almost none of us are interested in the economy. We're only interested in our own personal situation, and that of the people directly around us (family, friends, colleagues, local neighborhood, possibly also the country).

 

I've said this in another thread as well: I get the idea that you regard the economy as a plan-economy, while in reality it's more a response-economy... and that you think that the governments are actually in control. In reality, I think there is no plan anymore, we all respond to other developments. At best, some government agencies try to make a crude estimate of the effect of certain plans.

 

At the moment, Capitalism is it... although in many cases (esp. Europe) it has some Socialist things too. Governments make a few more regulations or a couple less regulations. The tax levels change a bit and are quite different in different parts of the world... Businesses come, and businesses go. We fight some wars if there is some economic interest... But apart from that, everybody is just going with the flow.

 

Have you ever played Sid Meier's Civilization? I think reality it's pretty similar (although a lot more complicated). You start off with a plan... but rather sooner than later, you're mostly responding to developments that you cannot control yourself. The economy is quite similar to that.

 

So, why do politicians say they will create more jobs? Most likely because they actually really want to do that. Because they are unaware of the global implications of their plans. And because it just sounds good.

[lemur]

The "army of unemployed" referenced by Marx is a very black and white way of describing the elastic relationship between the number of unemployed as a percent of the population that generally indicates job openings can be filled in a reasonable span of time. While it is true capitalism cannot effectively function with 100% employment I'd challenge Marx to find any mechanism to employ the bottom 5% of people (rating by hireability) in a Jerry Springer studio audience.

I think it's going too far to assume that Marx is saying that everyone is "employable." I think the reserve-army concept is just an observation of an effect of the invisible-hand that also has a pedagogical effect on workers. Whereas in pre-capitalist self-sustainment economics, individuals would have had to just search around for food, try to cultivate it, and make their own houses, etc.; in capitalism, they become increasingly able to sell their labor and this transforms them into competitors in a working-class. Then, the more efficient production processes become, the less labor is needed to accomplish them, which allows greater numbers of people to be left unemployed, which stimulates more competition to accept lower wages and accept whatever terms are offered by employers. In other words, it is just intensification of economic authoritarianism as a result of economic organization increasing.

 

 

Have you ever played Sid Meier's Civilization? I think reality it's pretty similar (although a lot more complicated). You start off with a plan... but rather sooner than later, you're mostly responding to developments that you cannot control yourself. The economy is quite similar to that.

 

So, why do politicians say they will create more jobs? Most likely because they actually really want to do that. Because they are unaware of the global implications of their plans. And because it just sounds good.

I have noticed this about everyday economic consciousness and it makes me want to tear my hair out. All you hear is people complaining about cuts in wages/hours and wanting more money. There is rarely any oversight expressed regarding economic resources and what people think is achievable in terms of fulfilling material and social needs and how. People literally tell me that if the government just secretly printed out more money and distributed it, people could just spend it on whatever they want and life would be bountiful. It's like people live in a garden of Eden where there's an endless fountain of everything to be had as long as you have the money to pay for it. It's like there's no recognition that it is human beings like themselves doing everything to produce and distribute all that stuff and not some god(s). And, yes, they are just "going with the flow" and thinking that as long as they do, everything will just automatically work out in their favor.

 

 

[CaptainPanic]

I have noticed this about everyday economic consciousness and it makes me want to tear my hair out. All you hear is people complaining about cuts in wages/hours and wanting more money. There is rarely any oversight expressed regarding economic resources and what people think is achievable in terms of fulfilling material and social needs and how. People literally tell me that if the government just secretly printed out more money and distributed it, people could just spend it on whatever they want and life would be bountiful.

My point was that nobody completely understands it... not even our leaders, not even the CEO's of the large corporations, and not you or me either.

But I admit that some people seem more dimwitted than others.

 

The world as a whole behaves like a mob. There is no leader with a vision. We're all in it, and we all have our own plans and ideas... and the combination of all of that gets us somewhere.

 

It's like people live in a garden of Eden where there's an endless fountain of everything to be had as long as you have the money to pay for it.

Well... I am sorry but that is a pretty accurate description of reality for any Westerner.

 

- Goods come into our shops by truck. We do not really know how it ever got into the truck. We're rather clueless about who made it, and where... although quite a few products seem to have a little logo saying "Made in China". That reduces the puzzle to only 1.3 billion possible people who made it. Who transported it from there to here will always remain a mystery.

- Food arrives in our supermarkets by truck too. Again, we do not know where it came from, or who got paid how much for it, and when.

 

And unless you buy local products, even the most well-informed people (like the ones on this forum) just cannot answer those things. It's just there.

 

It's like there's no recognition that it is human beings like themselves doing everything to produce and distribute all that stuff and not some god(s). And, yes, they are just "going with the flow" and thinking that as long as they do, everything will just automatically work out in their favor.

Strangely, we seem to have convinced a large part of the poor people in this world too that this is the way it is supposed to be. They too just go with the flow.

 

And in all fairness, you cannot realistically expect people to do their everyday jobs, live their everyday lives and also worry about the entire world as well? You and me just happen to be in a situation where we do... we're probably surrounded by people who do too (friends, family, colleagues). But we are a tiny, and very frustrated, minority.

[lemur]

My point was that nobody completely understands it... not even our leaders, not even the CEO's of the large corporations, and not you or me either.

But I admit that some people seem more dimwitted than others.

It's not that no one completely understands it or that some understand it better than others. It's that people have what can best be described in Marx's terms as "false consciousness." That could mean a lot of different things but I mean it to refer specifically to people not being aware of the direct material relations involved in producing and distributing goods and services. People are simply not aware of what resources they are consuming and what labor is being done in exchange for the money they spend or that is extracted from their bank accounts for various reasons. Part of this is willful ignorance because people simply don't want to face up to the fact that the actual labor they perform doesn't add up to a fraction of what they consume. This is frightening to realize because it makes you very vulnerable to losing your means of depending on economic systems far beyond your control. In reality, though, all economic activities are within the control of the people directly participating in them. It's just there are loads of other regulators, managers, administrators, etc. attempting to influence them with any number of rules and other constraints that facilitate spreading money around to everyone instead of just the people who directly produce needed goods and services.

 

The world as a whole behaves like a mob. There is no leader with a vision. We're all in it, and we all have our own plans and ideas... and the combination of all of that gets us somewhere.

Ultimately there's really no "us" thought "getting somewhere" collectively. (Social)capitalism makes sure of that by limiting who gets access to money and how much.

 

Well... I am sorry but that is a pretty accurate description of reality for any Westerner.

 

- Goods come into our shops by truck. We do not really know how it ever got into the truck. We're rather clueless about who made it, and where... although quite a few products seem to have a little logo saying "Made in China". That reduces the puzzle to only 1.3 billion possible people who made it. Who transported it from there to here will always remain a mystery.

- Food arrives in our supermarkets by truck too. Again, we do not know where it came from, or who got paid how much for it, and when.

 

And unless you buy local products, even the most well-informed people (like the ones on this forum) just cannot answer those things. It's just there.

Yes, but you know that someone just like you contributed some labor to the process. You might not ever know exactly who or how it was done, but you can be aware that all those people are part of the same economy that is providing you and people you know with everything you have.

 

And in all fairness, you cannot realistically expect people to do their everyday jobs, live their everyday lives and also worry about the entire world as well? You and me just happen to be in a situation where we do... we're probably surrounded by people who do too (friends, family, colleagues). But we are a tiny, and very frustrated, minority.

You and other people who talk like this make it sound as if economics isn't failing. You act like it is some kind of penance to understand economics so that you will be worth your entitlements. The reality is that when people lose hours, pay, or lose jobs completely, they have to figure out a way to sustain their bodies and try to avoid homelessness if possible. If there was more than enough to go around, why would recession be never-ending, as it seems to be? Clearly people have to come up with new means of production/consumption because they are gradually getting cut off from the ones they've grown accustomed to.

 

 

[Marat]

Wages are the by-product of the interaction between the supply of workers and the demand for workers by industry, agriculture, and service jobs. Only if there is always a surplus of workers relative to the demand for workers can wages be kept low, which is what capitalism requires, since the whole point of capitalists investing is to buy productive forces which can employ workers for less wage than the value of the products they make. This is called 'making a profit' if you are a capitalist, or 'exploiting the workers' if you are a Marxist.

 

Historical examples show how much more empowered ordinary people become against the wealthy when the supply of workers is reduced against the demand for workers. This occurred after the Black Death in the 14th century destroyed a third of Europe's population, resulting in a shortage of workers relative to the demand for workers, which not only raised incomes for laborers but also freed them from much of the bondage of medieval laws.

 

Capitalism revolves around a central absurdity that while there is a huge demand for work to satisfy essential human needs being done which the amount of workers available could never meet -- such as home care workers for the sick and elderly, repair for substandard slum housing, tutoring for children at risk of falling behind in school, big brothers and big sisters for children without parents, high quality day-care workers, truly caring foster parents, psychological support staff for those dying alone in hospitals, etc. -- this demand never becomes 'real' in capitalist terms, since there is no profit to be made in employing workers to satisfy this demand. So capitalism simply denies these essential human needs any representation -- even though satisfying these needs could both generate real human happiness and employ countless workers -- because bringing workers to address the need would not generate a profit for capitalists to skim off, given that the demand comes from people without any money. So in this way capitalism creates a simultaneously cruel and artificial shortage of jobs and an unnecessary unemployment.

 

This absurdity of capitalism is intensified by the fact that the potential workers who are made artificially unemployed in the presence of a huge human demand for their labor by the insistance of capitalism that no work ever be done, no matter how necessary -- unless capitalists can skim off a profit from the process -- are now punished with inadequate welfare payments, poverty, or even starvation for the unemployment which capitalists have imposed on them! Shame on you, you lazy, unemployed worker! We are going to impose on you a type of slavery known as 'workfare,' requiring you to travel large distances by bus in the early morning hours to do vulgar, demeaning work paying a minimum wage as punishment for the fact that capitalism doesn't provide enough reasonable labor for you.

 

The essential problem is that the economy should be organized to ensure the greatest possible happiness for the greatest number of people, but if it is in fact organized so that nothing can be done unless it makes profits for capitalists, there will always be a severe tension between the natural utilitarian goal of social life and the artificial capitalist requirement of our economic system. Only if the latter goal were abandoned could society operate to maximize the satisfaction of genuine human needs.

[John Cuthber]

"Since labor-oriented political-theorists surely know of this logic, why do they always call for more jobs?"

Possibly because they believe a smaller "reserve army of unemployed workers" is better.

 

How big did Marx say the "army" should be?

How many do you think it should be?

Would a million more be better for the economy? How about a million fewer?

Is there an objective way to answer that sort of question?

If not, is it a shock that two groups of people have differing views on it?

 

 

 

Of course there's the other reason.

They agree that Capitalism needs this army, but they don't think much of Capitalism.

Here's a bad analogy.

I think that religious extremism needs an army of people who feel so disenfranchised that they consider suicide bombing as a reasonable option.

I don't like religious extremism; so I would prefer there not to be a group of people in that position. (It's not the only reason I don't like it, but it's a valid reason). To that end I will fight for the improvement of their conditions.

[lemur]

Capitalism revolves around a central absurdity that while there is a huge demand for work to satisfy essential human needs being done which the amount of workers available could never meet -- such as home care workers for the sick and elderly, repair for substandard slum housing, tutoring for children at risk of falling behind in school, big brothers and big sisters for children without parents, high quality day-care workers, truly caring foster parents, psychological support staff for those dying alone in hospitals, etc. -- this demand never becomes 'real' in capitalist terms, since there is no profit to be made in employing workers to satisfy this demand. So capitalism simply denies these essential human needs any representation -- even though satisfying these needs could both generate real human happiness and employ countless workers -- because bringing workers to address the need would not generate a profit for capitalists to skim off, given that the demand comes from people without any money. So in this way capitalism creates a simultaneously cruel and artificial shortage of jobs and an unnecessary unemployment.

But social capitalism exploits these types of demand by using government to extract more money from people who have it and giving it to other people who get to spend it as compensation for performing all these forms of social-work. Without these mechanisms of redistributing money from profit to consumers, GDP would presumably drop as these social-workers would be unemployed and have less money to spend. If GDP decreased in this way, businesses would make less profit and thus have less means to exploit more workers. So social-spending is a means of strengthening profit-making/worker-exploitation.

 

punished with inadequate welfare payments, poverty, or even starvation for the unemployment which capitalists have imposed on them! Shame on you, you lazy, unemployed worker! We are going to impose on you a type of slavery known as 'workfare,' requiring you to travel large distances by bus in the early morning hours to do vulgar, demeaning work paying a minimum wage as punishment for the fact that capitalism doesn't provide enough reasonable labor for you.

What forms of labor does this entail? Is it not something of value that is consumed by the people required to do it? Personally, I think unemployed people should receive opportunities to perform labor of fundamental necessity, so that there is more food, housing, etc. to go around. Too often it seems these same welfare state governments that offer such good protection against poverty are the same ones that fight the hardest to keep the global poor outside their borders to prevent having to provide expensive welfare services for them.

 

The essential problem is that the economy should be organized to ensure the greatest possible happiness for the greatest number of people, but if it is in fact organized so that nothing can be done unless it makes profits for capitalists, there will always be a severe tension between the natural utilitarian goal of social life and the artificial capitalist requirement of our economic system. Only if the latter goal were abandoned could society operate to maximize the satisfaction of genuine human needs.

How are people supposed to get money to redistribute and spend if capitalism isn't providing stuff to spend it on and collecting the money to redistribute? I agree there are natural utilitarian goals, but for the privileged global class of people whose means of consumption are provided for them so that their utilitarian goals need not involve more than showing up for work, caring for themselves, shopping, and socializing; I would say that their welfare is coming on the backs of everyone subjugated to provide the food, goods, and services they consume in their natural pursuit of social life. Imo, the goal of socialism should be to distribute all burdens of economic production as equally as possible so that no class or individuals should have to perform the most undesirable labor while other classes and individuals get to consume the fruits of the economy while engaging in more privileged jobs.

 

How big did Marx say the "army" should be?

How many do you think it should be?

Would a million more be better for the economy? How about a million fewer?

Is there an objective way to answer that sort of question?

If not, is it a shock that two groups of people have differing views on it?

Personally, I don't think any such army should be necessary, but that would require everyone being willing to contribute their labor in any way needed. If there was no shortage of enthusiastic workers ready to relieve others of their labor burdens, why would it be necessary to induce low-wage acceptance and fear of competition among workers? However, in the capitalist logic that workers have to be disciplined to accept lower wages and poor conditions, I would say the more unemployed the better because every sector needs a significant number of people standing in line for jobs, waiting to take lower pay and do whatever it takes to replace their predecessor. This also requires workers being trained in multiple areas so that more individuals can compete for each job than if everyone was only trained to do one thing. Would you also advocate training people only in a single specialty to prevent competition among workers and maximize their power to leverage the highest possible wage from their employer? If the worker was maintaining your house, would you want them to have the same leveraging power to demand half your income or go on strike and leave your plumbing backed up and your roof leaking? Would you want your food to cost half you income? How much would you be willing to support workers in taking from your budget in order to ensure they get fairly compensated for their labor instead of getting exploited?